Many professionals working hard to build a career make the same mistake. They have no idea how valuable they are. Usually people either undervalue or overvalue themselves.
Often, people who undervalue themselves get taken advantage of. In my time working in TV news, I saw many highly talented professionals who worked the same overnight shift for years, when in fact they were overqualified for it. They just couldn't seem to convince management to move them to more desirable positions in the daytime or evening.
Meanwhile, the same industry is replete with people who overvalue themselves, land a coveted position, and then struggle to maintain it more than several months. Such people may have an inflated estimation of what they bring to the table and it can rub people the wrong way.
You find these same phenomena across industries. Fortunately, it's safe to say that the longer you work, you start to get a more accurate picture of what you're worth and things can even out. If you know your accurate professional value, you stand a better chance of negotiating positions and coming from a place of integrity in your interactions with people who do the hiring.
Factors That Impact Professional Value
Professional value is not necessarily the same as the market value for an advertised position. You can't just go on the Bureau of Labor Statistics website or a salary aggregator website and pick a number. More accurately, your professional value comes down to several factors including:
- Experience - Your past industry experience and performance can determine how easily you pick up on the role and the timeframe in which you begin creating business value as an employee.
- Education - Credentials often serve as the first benchmark in determining professional value. Those with higher degrees may automatically receive a better offer for employment.
- Gender - It might be somewhat controversial to frame gender this way in this post, but there's no denying that a pay gap does still exist between men and women in the US. You need to account for it when determining what your professional value might be. According to data from the Bureau of Labor Statistics in 2016, women earned a median of $749 per week across all full-time positions and men earned a median of $915 per week. Gender does not impact actual value, but may impact how certain employers perceive value.
- Company structure - Geographical location, business size, and industry also affect employee salary values. Additionally, different roles within the business may impact value - those who oversee other employees take on more responsibility and typically receive higher pay.
Before you accept the next offer that comes your way, consider the impact of not truly knowing your value. If a company hires two people at the same time and only one negotiates for a higher salary, the pay gap may widen over time. At year 35, a 7 percent discrepancy in base pay followed by the same pay raises over time could leave the person who did not negotiate working for eight more years to make up the difference.
How to Recognize and Express Your Value
If you suspect you could improve your workplace salary/positional negotiations, consider these methods for recognizing and expressing your value:
- Discover the baseline - Look for employer driven data on average salaries for credibility. Use the position that offers a 70% or better matchup with your skills and everyday workflow, and determine the average or median pay for that position across male and female employees. This baseline figure may not 100% reflect your face value in a business, but it does provide some perspective on the position.
- Consider your outlying factors - If you manage a team of people, work in an urban environment with a high cost of living, work for a large company, or work in a growing or high-demand industry, your total professional value is likely higher than the median. Education, skills, past performance, and experience also figure into your total value. Look at average pay rates for a similar management position in your industry and geographical pay differences among others to create a reasonable pay range. The upper limit should represent the maximum you might expect from your position and the lower limit should represent the point where you would need to walk away from an offer.
- Prepare for any value-based negotiation - Before you walk into a performance review, interview, or promotion discussion, prepare to assert your position. To agree on a mutually beneficial arrangement, you may need to reference specific numbers, support your claim with a logical argument, and express a willingness to compromise. Practice what you are going to say so you don't come off as entitled or cocky during communications.
- Don't forget about benefits - Beyond salary, the perks and benefits of a job may offset a lower salary offer. Discuss benefits after pinpointing pay, and identify your top benefit requests before the meeting. Relocation reimbursement, insurance, stock options, flexible work arrangements, and other perks can set competitive employers apart.
If you're not happy in your current position or want to take on more responsibility, take a hard look at your professional value. With this information in mind, you'll get a much more clear idea of your current value, the compensation range you currently deserve, and where confident, reasonable negotiations can take you in the future.